Latest news with #Roubini
CNBC
06-07-2025
- Business
- CNBC
Economist Nouriel Roubini sees a ‘mini stagflationary shock' coming in the second half of 2025
An economist and investor nicknamed "Dr. Doom" sees a rough patch ahead for the U.S. economy, but isn't advocating any panicked selling. Nouriel Roubini told CNBC that he expects the core personal consumption expenditures index — the Federal Reserve's preferred inflation metric — to reach about 3.5% by the end of the year, and economic growth to weaken and possibly turn negative. Best known for calling the 2008 Global Financial Crisis, Roubini said the second half will amount to "a mini stagflationary shock," and that the Fed will hold off on rate cuts until at least December. That view includes an expectation of a "mild" resolution to trade negotiations that ends with many countries facing a 15% rate, the economist said. "I'm not expecting, certainly, anything close to April 2," Roubini said, referring to the tariff levels announced by President Donald Trump that day that sparked a steep market sell-off. Roubini, a Harvard-trained economist, has a long track record in the academia, government and the private sector. The "Dr. Doom" moniker refers to numerous macroeconomic warnings he has issued throughout his career. His hit rate is not perfect, but he was early in warning about the financial crisis and a virus-induced recession in 2020. He is also one of the portfolio managers on the Atlas America Fund (USAF) , an ETF launched late last year that aims to guard against economic risks from structurally higher inflation to climate change. The fund is designed to be less volatile than the stock market but is "not a portfolio for doomsday," Roubini said. The fund is still small and thinly traded, with only about $17 million in assets, according to FactSet. But performance has been solid. The multi-asset fund has gained more than 5% since inception last November. That trailis the S & P 500 , but USAF has shown its defensive mettle, falling less than 3% in the days following the April 2 "Liberation Day" tariff announcements, when U.S. stocks soon fell roughly 20%. USAF 1Y mountain The Atlas America Fund saw a smaller drawdown in April than broad stock market indexes. "We don't particularly want outsized returns in one month. We'd rather have the slow and steady uptick, which is exactly what we've been seeing," said Puneet Agarwal, one of other portfolio managers for USAF. The portfolio, which includes large positions in gold, short-term U.S. government debt and exposure to agricultural commodities, has changed some since the fund's launch. USAF has recently added exposure to defense technology and cybersecurity stocks, and bought short-term inflation-protected bonds, while dialing back holdings in real estate, Agarwal said. The fund's large bet on gold helped it outperform the stock market earlier this year, but also contributed to USAF's relatively sluggish performance in June. Roubini said the bet on gold is part of a longer-term theory that the world is moving away from the U.S. dollar. "We're not expecting things to crash. But the trend is clear and it is going [in] one direction," Roubini said.
Yahoo
07-06-2025
- Business
- Yahoo
Why Wall Street's Dr. Doom now wants to be Dr. Boom
Nouriel Roubini, who's been known as "Dr. Doom" for 17 years, is feeling more upbeat. The economist has scaled back his recession call and thinks the US is headed for an investment boom. He told BI there are three things that have driven his newfound optimism. Wall Street has been calling him "Dr. Doom" for 17 years, but Nouriel Roubini — the economist famous for his persistently bearish and frequently dystopian takes on the world economy — is sounding surprisingly positive lately. He's rescinded his earlier call for a recession, and now sees a US tech and artificial intelligence investment boom unfolding that will uplift the economy through the rest of this decade. By 2030, Roubini thinks economic growth in the US will double from around 2% to 4%, while productivity growth surges from around 1.9% to 3%. The stock market is also likely to climb higher, he told Business Insider in an interview, predicting the S&P 500 would see high single-digit percentage growth in 2025, on par with its historical return. It's a sharp turnaround from the gloomy forecasts he' is known for. Roubini told BI the nickname started to stick in 2008, when the New York Times referred to him as "Dr. Doom" after he correctly called the Great Financial Crisis, he told BI. "Even before, I always said I'm not Dr. Doom and I'm Dr. Realist, first of all," Roubini said. He said that he's made numerous forecasts that were more bullish than the consensus throughout the years when the evidence lines up. "So I don't know why people think that I'm always Dr. Doom. It's not the case." His outlook, though, has brightened considerably since 2022. Back then, he appeared on TV and penned op-eds warning of a coming stagflationary debt crisis. At the time, he described the turmoil he saw looming as an all-in-one financial crisis involving spiraling debt levels, soaring inflation, and a severe recession. Roubini told BI there are a few things that have gotten him to change his tune. Roubini says he began to hear the murmurs of the AI revolution well before ChatGPT went viral at the end of 2022. In his 2022 book, "Megathreats," he acknowledged the potential for artificial intelligence to significantly boost economic growth and serve as a major tailwind for markets. That's become a reality way faster than Roubini expected, and a major reason he's become more bullish, he told BI. He believes the economy could start to reap the growth and productivity benefits of AI in the next several years, particularly as humanoid robots enter the mainstream. A breakthrough in fusion energy would be another bullish force for the economy, Roubini said. Fusion energy hasn't been achieved yet, but tech firms are pouring vast sums of money into making it happen. Chevron and Google contributed to a more than $150 million funding round this week for TAE Technologies, a fusion energy company that plans to have a working prototype power plant by the early 2030s. Type One Energy, another fusion energy firm, also plans to roll out a power plant by the middle of the next decade. "We're not in an AI winter anymore. We had the fusion winter for 40 years. We're not anymore," Roubini said, pointing to the stagnation in tech and fusion energy development is the past. "Now it's happening." President Donald Trump's tariffs may not be as harmful to the US economy as some investors think, Roubini says. He thinks it's more likely that markets will throw a tantrum and force Trump to walk back his most aggressive policies. That's already happened a few times this year. Roubini pointed to sharp sell-offs in the bond market that preceded Trump's 90-day pause of his "Liberation Day" tariffs, and the softening of his tone regarding firing Jerome Powell. "That means the bond vigilantes are the most powerful people in the world," Roubini said. "The instincts might be very bad, but then, markets are unforgiving," he added of policymakers. Roubini speculates that tariffs on China, for instance, could wind up somewhere around 39%, well-below the 145% tariff rate Trump proposed earlier in the year. Meanwhile, AI, quantum computing, and other tech advancements in the US can more than offset the impact of the trade war, Roubini said. Tariffs are expected to drag down GDP growth by 0.06% a year through 2035, according to estimates from the Congressional Budget Office. It's a fraction of the 2 percentage point increase in growth Roubini expects to see by the end of the decade. Roubini now pegs the odds of a recession to just around 25%. Even if the US enters a downturn this year, Roubini says he expects it to be shallow and short, as the Fed can cut interest rates to boost the economy, while tech powers growth over the long-run. That's not to say Dr. Doom has shed all of his bearish views. Roubini says many of the things he feared several years ago — stagflation, spiraling government debt levels, and rising geopolitical conflict — still loom. He rattled off a list of potential risks the US could conceivably face in the future: migration controls fueling stagflation in the economy, the US dollar collapsing in value, and China and the US not reaching a trade agreement and seeing an escalating cold war, to name a few scenarios. "So there's plenty of stuff in the world that can go wrong," he said. Read the original article on Business Insider
Business Insider
07-06-2025
- Business
- Business Insider
Why Wall Street's Dr. Doom now wants to be Dr. Boom
Wall Street has been calling him "Dr. Doom" for 17 years, but Nouriel Roubini — the economist famous for his persistently bearish and frequently dystopian takes on the world economy — is sounding surprisingly positive lately. He's rescinded his earlier call for a recession, and now sees a US tech and artificial intelligence investment boom unfolding that will uplift the economy through the rest of this decade. By 2030, Roubini thinks economic growth in the US will double from around 2% to 4%, while productivity growth surges from around 1.9% to 3%. The stock market is also likely to climb higher, he told Business Insider in an interview, predicting the S&P 500 would see high single-digit percentage growth in 2025, on par with its historical return. It's a sharp turnaround from the gloomy forecasts he' is known for. Roubini told BI the nickname started to stick in 2008, when the New York Times referred to him as " Dr. Doom" after he correctly called the Great Financial Crisis, he told BI. "Even before, I always said I'm not Dr. Doom and I'm Dr. Realist, first of all," Roubini said. He said that he's made numerous forecasts that were more bullish than the consensus throughout the years when the evidence lines up. "So I don't know why people think that I'm always Dr. Doom. It's not the case." His outlook, though, has brightened considerably since 2022. Back then, he appeared on TV and penned op-eds warning of a coming stagflationary debt crisis. At the time, he described the turmoil he saw looming as an all-in-one financial crisis involving spiraling debt levels, soaring inflation, and a severe recession. Roubini told BI there are a few things that have gotten him to change his tune. 1. Artificial Intelligence Roubini says he began to hear the murmurs of the AI revolution well before ChatGPT went viral at the end of 2022. In his 2022 book, "Megathreats," he acknowledged the potential for artificial intelligence to significantly boost economic growth and serve as a major tailwind for markets. That's become a reality way faster than Roubini expected, and a major reason he's become more bullish, he told BI. He believes the economy could start to reap the growth and productivity benefits of AI in the next several years, particularly as humanoid robots enter the mainstream. 2. An energy revolution A breakthrough in fusion energy would be another bullish force for the economy, Roubini said. Fusion energy hasn't been achieved yet, but tech firms are pouring vast sums of money into making it happen. Chevron and Google contributed to a more than $150 million funding round this week for TAE Technologies, a fusion energy company that plans to have a working prototype power plant by the early 2030s. Type One Energy, another fusion energy firm, also plans to roll out a power plant by the middle of the next decade. "We're not in an AI winter anymore. We had the fusion winter for 40 years. We're not anymore," Roubini said, pointing to the stagnation in tech and fusion energy development is the past. "Now it's happening." 3. Markets are checking Trump President Donald Trump's tariffs may not be as harmful to the US economy as some investors think, Roubini says. He thinks it's more likely that markets will throw a tantrum and force Trump to walk back his most aggressive policies. That's already happened a few times this year. Roubini pointed to sharp sell-offs in the bond market that preceded Trump's 90-day pause of his "Liberation Day" tariffs, and the softening of his tone regarding firing Jerome Powell. "That means the bond vigilantes are the most powerful people in the world," Roubini said. "The instincts might be very bad, but then, markets are unforgiving," he added of policymakers. Roubini speculates that tariffs on China, for instance, could wind up somewhere around 39%, well-below the 145% tariff rate Trump proposed earlier in the year. Meanwhile, AI, quantum computing, and other tech advancements in the US can more than offset the impact of the trade war, Roubini said. Tariffs are expected to drag down GDP growth by 0.06% a year through 2035, according to estimates from the Congressional Budget Office. It's a fraction of the 2 percentage point increase in growth Roubini expects to see by the end of the decade. Roubini now pegs the odds of a recession to just around 25%. Even if the US enters a downturn this year, Roubini says he expects it to be shallow and short, as the Fed can cut interest rates to boost the economy, while tech powers growth over the long-run. That's not to say Dr. Doom has shed all of his bearish views. Roubini says many of the things he feared several years ago — stagflation, spiraling government debt levels, and rising geopolitical conflict — still loom. He rattled off a list of potential risks the US could conceivably face in the future: migration controls fueling stagflation in the economy, the US dollar collapsing in value, and China and the US not reaching a trade agreement and seeing an escalating cold war, to name a few scenarios. "So there's plenty of stuff in the world that can go wrong," he said.
Yahoo
30-05-2025
- Business
- Yahoo
Wall Street's 'Doctor Doom' tells BI about his move into money management, where he's off to a market-beating start
Nouriel Roubini's America Atlas Fund has outperformed amid market volatility and inflation risks. Roubini's fund launched in November 2024 and is up 4%. The fund has heavy allocations to short-term Treasurys and gold. On a cold night in December, Nouriel Roubini stood in a dark room at Bloomberg's Manhattan headquarters and prophesied a menacing future for financial markets. Yields on 10-year Treasurys would soar to 8% thanks to persistent inflation, he said at Bloomberg's ETFs in Depth conference. That would send the S&P 500 and Nasdaq plummeting. The scene was perfectly on brand for the famously bearish economist widely known as Dr. Doom. That's why it might have been easy to dismiss his gloomy proclamations. Perhaps even more of a reason to discount Roubini's warnings was that he had just launched an ETF, the America Atlas Fund (USAF), meant to act as an alternative to the fixed-income segment of the traditional 60/40 portfolio. A cynical listener could have interpreted his speech as a pitch to buy his product because stocks and bonds would perform poorly. But six months later, the evidence is irrefutable: Roubini has nailed his opening act as a fund manager. Since USAF's launch in November, the S&P 500 is flat, suffering a violent 20% drawdown in the interim. Long-end Treasurys have also been volatile, and have sold off in tandem with stocks. Many of the driving forces behind those moves have been those inflation risks that Roubini warned of, including tariffs and restoring, and government spending. Meanwhile, USAF is up 4% and fell only 2% during the market's "Liberation Day" tantrum when stocks tanked and bond yields spiked. The fund has been volatility-resistant thanks to its heavy allocations to short-end Treasurys (about 50% of the portfolio) and gold (19%). The remaining holdings are a mix of commodities, REITs, and TIPS, and alternative investments. In other words, Roubini's timing couldn't have been better, and his warnings — at least directionally speaking — have been spot on. It's been a dream start for the New York University professor, who often gets flak for his regular pessimism. "Sometimes people say, 'You talk about stuff, but talk is cheap,'" Roubini told BI. "'Put your money where your mouth is. Have some skin in the game.'" The 67-year-old Roubini, who is most known for predicting the 2008 financial crisis, could have simply kept on with his work at NYU and continued pontificating about where the economy was headed. But the economist wanted to take on a fresh challenge. "In different stages in life, you do different things," he said. In the final chapter of Roubini's 2022 book, "MegaThreats: Ten Dangerous Trends That Imperil Our Future, And How to Survive Them," he lays out how investors might protect themselves from downside risks. In recent years, he decided it was time to put those ideas to the test. It has always been a logical next step for him to wade into the world of asset management, he said. Plus, it's a chance to respond to his many detractors who have questioned the weight behind his predictions since he didn't have any money under his purview. "After a career in academia, of policy, of providing economic advice, more and more people say, 'If you are that smart, why don't you try to also manage money rather than just talking about it," he continued. "So it was a natural thing that would have eventually happened." It remains to be seen if Roubini can keep his string of success going in the years ahead. The outlook informing his positioning is that persistent inflation in the 5-6% range will continue to put upward pressure on 10-year Treasury yields. That's why he's sitting heavily in short-term Treasurys at the moment, collecting a similar yield to longer-term assets while not having to endure the same volatility. If 10-year rates were to get up toward 8%, that would be the right time to buy in, he said. His views on inflation are well above the consensus in markets and among Wall Street banks, though it's still unclear what impact tariffs and potential tax cuts will have on consumer prices. If inflation fears dissipate, Roubini's exceptionally well-timed introduction to the asset management space may very well prove to be beginner's luck. Either way, investors now have a way to grade Roubini's forecasts in real time. "One thing is to talk about money, and another is managing it," Roubini said. "You see right away the feedback between your ideas and what happens in the real markets." Read the original article on Business Insider
Yahoo
30-05-2025
- Business
- Yahoo
Wall Street's 'Doctor Doom' tells BI about his move into money management, where he's off to a market-beating start
Nouriel Roubini's America Atlas Fund has outperformed amid market volatility and inflation risks. Roubini's fund launched in November 2024 and is up 4%. The fund has heavy allocations to short-term Treasurys and gold. On a cold night in December, Nouriel Roubini stood in a dark room at Bloomberg's Manhattan headquarters and prophesied a menacing future for financial markets. Yields on 10-year Treasurys would soar to 8% thanks to persistent inflation, he said at Bloomberg's ETFs in Depth conference. That would send the S&P 500 and Nasdaq plummeting. The scene was perfectly on brand for the famously bearish economist widely known as Dr. Doom. That's why it might have been easy to dismiss his gloomy proclamations. Perhaps even more of a reason to discount Roubini's warnings was that he had just launched an ETF, the America Atlas Fund (USAF), meant to act as an alternative to the fixed-income segment of the traditional 60/40 portfolio. A cynical listener could have interpreted his speech as a pitch to buy his product because stocks and bonds would perform poorly. But six months later, the evidence is irrefutable: Roubini has nailed his opening act as a fund manager. Since USAF's launch in November, the S&P 500 is flat, suffering a violent 20% drawdown in the interim. Long-end Treasurys have also been volatile, and have sold off in tandem with stocks. Many of the driving forces behind those moves have been those inflation risks that Roubini warned of, including tariffs and restoring, and government spending. Meanwhile, USAF is up 4% and fell only 2% during the market's "Liberation Day" tantrum when stocks tanked and bond yields spiked. The fund has been volatility-resistant thanks to its heavy allocations to short-end Treasurys (about 50% of the portfolio) and gold (19%). The remaining holdings are a mix of commodities, REITs, and TIPS, and alternative investments. In other words, Roubini's timing couldn't have been better, and his warnings — at least directionally speaking — have been spot on. It's been a dream start for the New York University professor, who often gets flak for his regular pessimism. "Sometimes people say, 'You talk about stuff, but talk is cheap,'" Roubini told BI. "'Put your money where your mouth is. Have some skin in the game.'" The 67-year-old Roubini, who is most known for predicting the 2008 financial crisis, could have simply kept on with his work at NYU and continued pontificating about where the economy was headed. But the economist wanted to take on a fresh challenge. "In different stages in life, you do different things," he said. In the final chapter of Roubini's 2022 book, "MegaThreats: Ten Dangerous Trends That Imperil Our Future, And How to Survive Them," he lays out how investors might protect themselves from downside risks. In recent years, he decided it was time to put those ideas to the test. It has always been a logical next step for him to wade into the world of asset management, he said. Plus, it's a chance to respond to his many detractors who have questioned the weight behind his predictions since he didn't have any money under his purview. "After a career in academia, of policy, of providing economic advice, more and more people say, 'If you are that smart, why don't you try to also manage money rather than just talking about it," he continued. "So it was a natural thing that would have eventually happened." It remains to be seen if Roubini can keep his string of success going in the years ahead. The outlook informing his positioning is that persistent inflation in the 5-6% range will continue to put upward pressure on 10-year Treasury yields. That's why he's sitting heavily in short-term Treasurys at the moment, collecting a similar yield to longer-term assets while not having to endure the same volatility. If 10-year rates were to get up toward 8%, that would be the right time to buy in, he said. His views on inflation are well above the consensus in markets and among Wall Street banks, though it's still unclear what impact tariffs and potential tax cuts will have on consumer prices. If inflation fears dissipate, Roubini's exceptionally well-timed introduction to the asset management space may very well prove to be beginner's luck. Either way, investors now have a way to grade Roubini's forecasts in real time. "One thing is to talk about money, and another is managing it," Roubini said. "You see right away the feedback between your ideas and what happens in the real markets." Read the original article on Business Insider Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
